Investing in Tissue Paper Production

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With rising demand for the product, Uba Godwin writes that one of the most viable and profitable small scale industries to invest in Nigeria is the tissue paper industry

The World Bank has predicted that Nigeria will get out of recession and grow its Gross Domestic Product by one per cent this year after plunging into its worst recession in over two decades.
The bank said that the Sub-Saharan African growth is expected to pick up modestly to 2.9 per cent in 2017 as the region continues to adjust to lower commodity prices. “Growth in South Africa and oil exporters is expected to be weaker, while growth in economies that are not natural-resource intensive should remain robust.
According to the bank the growth in South Africa is expected to edge up to a 1.1 per cent pace this year; Nigeria is forecast to rebound from recession and grow at a 1 per cent pace while Angola is projected to expand at a 1.2 per cent pace.”

The World Bank’s January 2017 Global Economic Prospects report also projected that growth in the advanced economies would edge up to 1.8 per cent in the current year. It stated that fiscal stimulus in major economies, particularly in the United States, could generate faster domestic and global growth than projected, although rising trade protection could have adverse effects.

Growth in emerging market and developing economies as a whole should pick up to 4.2 per cent this year from 3.4 per cent in the year just ended amid modestly rising commodity prices, the bank stated.
Emerging market and developing economy commodity exporters are expected to expand by 2.3 per cent in 2017 after an almost negligible 0.3 per cent pace in 2016 as commodity prices gradually recover and as Russia and Brazil resume growing after recessions. It, however, added that the outlook was clouded by uncertainty about policy direction in major economies.

Commenting on the report, the President, World Bank Group, Jim Yong Kim, stated, “After years of disappointing global growth, we are encouraged to see stronger economic prospects on the horizon.
“Now is the time to take advantage of this momentum and increase investments in infrastructure and people. This is vital to accelerating the sustainable and inclusive economic growth required to end extreme poverty.”
The report noted the worrisome recent weakening of investment growth in the emerging markets and developing economies, which account for one-third of the global GDP and about three quarter of the world’s population and the poor.

In Nigeria some of the ways to adopt to increase the Gross National Product (GDP) is to develop Agriculture, establish more small and medium scale industries and diversifying to other mineral resources.
One of the most viable and profitable small scale industries to invest into is production of toilet tissues (toilet rolls, serviettes and facial tissue) Most Nigerians consume toilet roll. Its demand is influenced by population explosion, rapid urbanization and social awareness. It is generally used for cleaning and sanitary purposes in households, restaurants, hotels, canteens, social gatherings, parties, maternity homes, clinics, hospitals, educational institutions, churches, night clubs, shops, fast food centres and offices.

Research findings indicate that Nigeria alone now needs over 950 million tons of tissue papers per annum. While our total local production output is still less than 150 million tonnes, the supply gap offers a tremendous opportunity for Nigeria investors.

Nigerian investors can now go into this lucrative business using locally made machines. Though there are imported machines as well, our local investors do not need to waste their scarce foreign exchange for the importation. The writer will assist you in procuring and installing quality machines that stand the test of time at moderate and affordable prices. The attractiveness of this project is that both the raw materials and equipment are locally available and the technology involved is very easy to understand and master. The essential equipment : – Core making machine; Rewinding System; Band Saw cutter; Embossing Unit and Perforating Unit.

These machine components are portable, simple to operate and durable. The machines will be procured from highly experienced local producers of such machines. The writer will supply the machines at the sum of N3.5Million. However, the imported machines (as indicated below) can go as high as N10million.

The locally made machines being introduced here is rugged, reliable and high performing with a capacity of one to 2tons per day. Operating on a single shift for a minimum of 250 days per annum, a total of 500 MT of tissue paper will be procured and processed into quality tissue products (toilet rolls & serviettes).
Raw materials include jumbo reels, and glue. Packaging materials include printed wrapping paper and nylon bags. All these are 100 per cent available locally.

The total sales revenue is N437.5million from which we deducted our total inputs of N315. 5million thus realizing a gross profit before tax of N122.5million in the first year.
Many Nigerians have burnt their fingers while sourcing local machinery from some inexperienced and dishonest fabricators who produce machines with very low efficiency. Many investors have been deceived. They also tell big lies about the efficiency, performance, capacity and life span of these machines. To guard against this industrial fraud, prospective investors can contact this writer for free investment advisory services. The issue of availability of raw materials should not disturb anybody because we have so many options to handle it.

On the whole, a toilet roll project is a very good small-scale industry, which can launch a small investor into the world of millionaires within one year.

A three-bedroom flat garage or warehouse may serve, as accommodation while staff strength of eight is required for effective production, marketing and administration. Bigger or smaller plants are also available at competitive prices.

For details on preparation of comprehensive & bankable feasibility studies/ report, sourcing & installation of quality & durable machines; Recruitment & Training, Sourcing of Investment funds, Estimated Cost Implications

Preliminary Expenses 500
Machinery & Equipment (depending on the type of machines) 10,000
Working (Variable) 5,500
Accommodation (Rented) (variable) 500
Contingencies 1,250
Total 17,750

For further enquiries, please contact the writer

Uba Godwin
Global Trust Consulting,
56, Ishaga Road (1st floor), Surulere, Lagos
Tel- 08034494437, 08023664368, 09093939140
E-mail: ubagodwin@yahoo.com